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Growing young population sparks Westchester rental boom

Luxury rental developments are thriving in Westchester County, driven by demand from New York City defectors looking to escape cramped living spaces and pricey payments.

“People are voting with their feet,” said Marissa Brett, the president of the Westchester County Association, a business development organization based in White Plains.

“They want to live in walkable communities with easy access to mass transit and shopping, where there are restaurants, entertainment, and other people with whom to socialize.

“Rents in Manhattan and Brooklyn are outrageous, so guess what? Renters are looking at Westchester’s very livable and booming cities.”

To accommodate Westchester’s newest residents, most of whom are young professionals who commute to work in the big city, developers are providing luxury options, with rates that are much cheaper than comparable living spaces in New York City.

For instance, The Lofts on Saw Mill River, a luxury property by Ginsburg Development Companies (GDC) that broke ground last May, will offer 950 s/f one-bedroom apartments for $2,900.

yonkersIn comparison, one bedroom apartments at Moinian Group’s Sky luxury rental at 605 West 42nd Street, start at $4,020.
When examined on a larger scale, the price differential between the two areas gets bigger.

According to Realtor.com, Westchester County has an average rental rate of $2,325 for one-bedroom apartments and $2,806 for two-bedroom units.

This represents a big discount from Manhattan. In the borough, the average rent for one-bedrooms is $3,807 while two-bedrooms go for an average of $6,953.
One of the most prolific Westchester areas in terms of luxury rental activity is White Plains.
Last year, local firm Lighthouse Enterprises and New York City developer Daten Group jointly built three residential buildings in the city.

According to the Westchester County Association, the three buildings, La Gianna at 10 Dekalb Avenue, The Dylan at 42 Waller Avenue, and The Reed at 115 North Broadway, are now almost fully leased.

While prices may be lower in Westchester, developers remain unfazed, lured in by a package of zoning changes and incentives for job creation and affordable housing development.
For instance, The Lofts on Saw Mill project, the $34.9 million GDC development, received $1.84 million in incentives from the county.

The endowment, part of which came from Westchester County Industrial Development Agency, was provided as financial support for land acquisition and infrastructure. The project was estimated to create 100 construction jobs over 18 months.

In return, Ginsburg will include 12 affordable apartments among the 66 units being built, dedicate 1.8 acres of “Great Lawn” to the Village and create a 10-space parking lot and pedestrian bridge to the South County Trailway, which runs by the property.

Westchester County Executive Robert P. Astorino said the Village was excited about the development.

And the local mayor, Peter Swiderski, said, “Ginsburg Development Companies has a reputation for building outstanding developments and we’re confident that they will deliver on these new rental apartments as well as the affordable units.”

In Port Chester, a village in Westchester County, a development boom is in play that most attribute to changes in zoning rules in 2013.

Yonkers
YONKERS

The zoning changes, which were meant to encourage the creation of more mixed-used properties, gave developers incentives in exchange for public benefits, such as donations for a housing program and a parking garage.

The incentives came in the form of density bonuses that gave builders extra space for their projects.

However, the appeal of Westchester County to residential developers may be best measured by the entry of new players.
Last March, Miami-based homebuilder Lennar Corporation, through its subsidiary Lennar Multifamily Communities, bought a 185,000 s/f property in White Plains for a $275 million project.

The site, which once contained the Westchester Pavilion shopping center, will be converted into a mixed-used property. In its application for incentives to the IDA, Lennar revealed that the planned building will have 95,600 s/f of retail and 756,300 s/f of multifamily space.

Earlier this year, Pennsylvania-based real estate firm LCOR gained approval for a luxury mixed-use development at 55 Bank Street in White Plains.

That project, which was stalled for several years, moved forward through incentives from the IDA.

The planned 776,000 s/f complex will contain a pair of 16-story buildings. The site, which used to be a commuter parking lot, will contain 561 apartment units and 6,300 s/f of retail space.

The increase in luxury rental options coincides with a demographic shift in Westchester’s wealthiest corners.
According to a 2014 report from Community Housing Innovations, a non-profit that runs shelters in Westchester, some parts of the county, particularly the areas of Rye of Pound Ridge, have lost half of its residents aged 25 to 34. This means that the county’s richest areas have become too expensive for younger residents.

While the exit of young residents poses a demographic problem, it hasn’t caused a widespread exodus of residents. The county’s population count registered some of the highest increases in the entire state. According to US Census Data, the population growth was highest in the town of Larchmont, which posted a three percent increase in 2014.

While it’s unclear how much of the new residents came from New York City, the economic effects of their arrival have been apparent.

In the city of Yonkers, for example, there has been a 12 percent increase in the number of residents making $200,000 to $400,000 annually. This has given developers like Ginsburg Development COmpanies reason to build luxury properties like River Tides at Greystone, a 330-unit rental complex that is under construction.

The $100 million project will have amenities such as a full concierge service, a swimming pool and a fitness center staffed by professional trainers and yoga instructors.

In August, GDC also unveiled a plan for a 55-unit luxury apartment building in the Greystone neighborhood as the latest project in its GDC Rentals brand. The three-story building at 1175-1183 Warburton Avenue will be built one block north of River Tides.

The four-parcel site was the location of a planned residential development by a previous owner that failed during the real estate crash of 2008. GDC expects to break ground in spring 2016.

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